Abstract: The high-quality human capital is an important support for the implementation of the strategy of“strengthening the country with science and technology”. The results of a quasi-natural experiment based on the exogenous policy construct of the enrollment expansion in high education in 1999 and a study with DID method show that the human capital expansion brought about by the university enrollment expansion policy has effectively increased the innovation capacity of cities, and that this effect has increased significantly over time. A mechanistic analysis shows that the expansion of human capital has significantly increased the skill level of workers, while skilled labor further induces the agglomeration effect of innovation factors and enhances the R&D capacity within cities, thus contributing to the increase of innovation level in cities. A heterogeneity analysis shows that human capital expansion has a greater effect on innovation in the eastern cities and the cities with a better innovation base, faster growth in capital goods imports and a higher degree of marketisation. In addition, by industry, human capital has a greater contribution to the increase in innovation capacity of urban secondary industries. Therefore, when further promoting the reform of market-based mechanisms, it is also important to focus on the supporting industrial policies and at the same time increase the policy support towards the less developed regions, so as to promote the coordinated industrial and regional developments.

Key words: human capital, university enrollment expansion, urban innovation, agglomeration effect, strengthening the country with science and technology